Vietnam's balancing act

30 November 2012

Dr Le Hong Hiep

Visiting Fellow, Institute of Southeast Asian Studies, Singapore

In early 1833, a United States delegation led by Edmund Roberts arrived in Vietnam on the sloop-of-war USS Peacock, which anchored in Vung Lam Bay, off modern Phu Yen province. As a “special confidential agent” of President Andrew Jackson, Roberts proposed to sign a treaty of commerce with the Nguyen Dynasty but failed in his mission due to misunderstandings caused by language barriers and Vietnam’s isolationist policy. It took the two countries another 166 years to conclude a bilateral trade agreement. Roberts’s failed mission was one of the many missed opportunities that, right from the early days of their interaction, prevented Vietnam and the United States from establishing a stronger relationship.

In the 20th century, the lack of meaningful economic interactions and unfavourable conditions during the Cold War era put further distance between the two countries. Vietnam had the misfortune to be caught up in the dire strategic competition between the Western and Eastern blocs as the Cold War intensified in the 1950s. As Vietnamese communists succeeded in defeating the French and were about to bring the whole country under their rule in 1954, they found themselves at the forefront of a US-led Western anti-communism containment policy. At the same time, the communist bloc recruited Vietnam as an “outpost against imperialism” in Southeast Asia. Eventually, Vietnam and America ended up in a bitter war that left indelible imprints on both their histories.

After the war, it took the countries two more decades to repair and normalise relations, which they achieved in 1995. Since then, the relationship has blossomed at a pace that has surprised many observers. The US is now Vietnam’s biggest export market and ranks among the country’s top 10 foreign investors. Political relations have also developed to a point that there have been calls from both sides to elevate the relationship to a strategic partnership. Meanwhile, military ties, although still modest, have also been tightened. US Defense Secretary Leon Panetta’s historic visit to Cam Ranh Bay on 3 June 2012 testifies to the strengthening relationship between the countries.

Nevertheless, with this historical background in mind, anyone interested in the future of US–Vietnam relations would have to consider two critical questions. First, as Cam Ranh Bay is not far from Vung Lam Bay, Panetta’s visit is reminiscent of Roberts’s mission in 1833. Will Vietnam grab the opportunity presented by America’s renewed interest in the country to secure a stronger relationship with the world’s Number One superpower, or let it slip by, as the Hue court did in 1833? Second, against the backdrop of intensifying strategic competition between the United States and China, a stronger US–Vietnam relationship would inevitably damage Vietnam’s relations with China. Will Vietnam be caught in a Cold War 2.0 and fall victim to another great-power game?

UNLIKE the Nguyen period, present-day Vietnam is a much more open country. Vietnam’s economic reforms since the 1980s have integrated the country into the global economy. In this regard, Vietnam considers the United States one of its most important economic partners. Investments from giant US high-tech corporations like Intel have opened the door to other foreign investors who can help the country move up the value-chain and create an innovative and efficient economy. Thus, Vietnam is keen to promote its economic ties with the United States. Its decision to enter negotiations on the Trans-Pacific Economic Partnership is an example of this.

However, as eager as Vietnam is to improve its relationship with the United States, how far it will go remains unclear. First, differences in the two countries’ political systems have caused Vietnam to be cautious. The Communist Party of Vietnam (CPV) still considers “peaceful evolution”—which is code for closer ties with the US that might lead to political liberalisation—a major threat to the regime’s security. It is the belief of a segment of the CPV leadership that the strategy is being used by Western countries, especially the United States, to gradually undermine and transform the CPV. Such fears are deepened by frequent criticisms of Vietnam’s poor human rights record. Many US politicians have even argued that improvements in Vietnam’s human rights record should be a precondition of further bilateral relations.

Meanwhile, Vietnam is careful not to let developments in US–Vietnam relations harm its ties with China. The asymmetry of power, the condition of geographical proximity, the increasing economic interdependence between China and Vietnam, as well as the ideological affinity between the two communist parties all tend to make Vietnamese policy makers think twice before making any move that may upset Vietnam’s relations with its northern neighbour. In addition, a deteriorated relationship with China would unquestionably destabilise Vietnam’s external environment and domestic economic development. As economic performance has now become the single most important source of the CPV’s political legitimacy, Vietnam would not want to go down this path. This points to one thing: although Vietnam wishes to promote economic exchanges with the United States, it might be hesitant about advancing political and military ties with its former adversary. However, actual developments in bilateral relations over the past few years point in the opposite direction; Vietnam’s interest in furthering political and military ties with the United States seems to have deepened even when such endeavours may upset China and unnerve a segment of the CPV leadership. Although Vietnamese diplomats say that growing US–Vietnam relationship should be framed within Vietnam’s overall foreign policy of diversification and multilateralisation, it is clear to most observers that the driving force behind Vietnam’s decision to forge a closer relationship with the US is by and large related to growing tensions in the South China Sea, where China is becoming increasingly assertive in advancing its territorial claims.

WITH competing claims over the Paracels, the Spratlys, and maritime boundaries, Vietnam and China are two major rivals in the South China Sea dispute. Vietnamese generally view the country’s loss of the Paracels to China in 1974, the naval clash with China in the Spratlys in 1988, and China’s maritime claim based on the nine-dotted line as evidence of China’s expansionism, to which Vietnam has fallen victim in the past. China’s recent growing assertiveness—as evidenced by the Binh Minh 02 incident in May 2011 (when Chinese vessels confronted a Vietnamese seismic survey ship), the recent establishment of Sansha (a prefecture-level city under Hainan province to administer the islands and atolls in the South China Sea), and China’s offering of nine blocks within Vietnam’s exclusive economic zone to international bidders in June—further alarms Vietnam of China’s intentions in the South China Sea.

Against this backdrop, Vietnam has moved to modernise its military, especially its navy and air force, and specifically to develop a deterrent capability against China in the South China Sea. For example, since the mid 1990s Vietnam has acquired modern Svetlyakclass attack-craft, Gepard-class frigates, six-Kilo-class submarines (the first to be delivered in 2013), Bastion land based anti ship cruise missiles, extended-range artillery munitions, and a substantial number of Sukhoi jet-fighters. Nevertheless, given the rapid modernisation of China’s military on a much larger scale, the military gap between the two countries keeps widening. So even though Vietnam has repeatedly emphasised a defence policy of self-reliance, it is in the country’s interests to deepen strategic relations with foreign powers to compensate for its considerable weakness in relation to China.

In this scenario, the United States turns out to be a preferred partner for Vietnam. First, the US is now the only power capable of effectively challenging and constraining China’s military ambitions. Second, while the perceived threat of “peaceful evolution”, allegedly plotted by the US and Western countries, has not brought about real dangers to the CPV regime, China’s threat to the country’s sovereignty and territorial integrity is much more imminent. And third, while it’s true that a closer relationship with the US might upset China and bring about negative consequences for Vietnam’s economy, the core basis of the CPV’s political legitimacy—rising nationalism and anti- China sentiment—means that bowing to China’s pressure and putting the country’s territorial integrity at stake would be even more detrimental to the CPV’s credibility and legitimacy.

Accordingly, the recent decision by the United States to refocus on the Asia-Pacific has been quietly welcomed in Vietnam. The US decision would also transform the dynamics of the dispute in Vietnam’s favour, at least in the short term.

Strategically speaking, the South China Sea dispute is now composed of three intertwined layers. The innermost layer involves the competition between China and individual ASEAN claimant states, including Vietnam. The middle layer is between ASEAN and China. The outermost layer is the newly emerging strategic competition between China and the United States, of which the South China Sea happens to be one of its theatres. Although the United States is not a party to the dispute, China’s strident ambitions and growing assertiveness in the South China Sea provide the US with an excuse to get involved. What the US seeks to ensure through its involvement is not just peace or freedom of navigation in the South China Sea, it now appears that the dispute is being used by the superpower as a convenient tool to contain the rise of China at a regional and global level.

The US move obviously aligns with Vietnam’s interests, which lie in trying to move the dispute with China to the outer layers so as to neutralise China’s superior strength. The US involvement, though indirect, is likely to make China act more prudently and less willing to use force. In addition, America’s strategic design on China will also ease US pressure on Vietnam’s human rights record and provide it with an opportunity to promote the bilateral relationship to a higher level.

Vietnam and the United States have recently taken steps to further strengthen their bilateral relations, especially in the political and military domains. The former enemies are now holding annual security, defence, and human rights dialogues. In particular, defence ties have and will continue to be improved. During his historic visit to Cam Ranh Bay, Secretary Panetta reportedly expressed US willingness to help renovate the port and called on Vietnam to grant US naval ships, including warships, greater access to the facility. And if the current pattern holds, the United States may consider lifting its embargo on the sale of lethal weapons to Vietnam in the near future. In addition, the countries have also taken steps to build further mutual trust and understanding. For example, since August 2012, a project funded by the US has started to clean up dangerous chemicals left from the defoliant Agent Orange at a location near Da Nang airport. The project is described by US ambassador David Shear as a concrete move by the two countries to bury the legacies of the past.

However, while bringing Vietnam significant strategic interests, the US–Vietnam rapprochement against the backdrop of deepening geopolitical rivalry between the United States and China also presents Vietnam with a number of risks, the most serious of which is dragging the country into a new great-power game.

As China steadily develops into a superpower, a Cold War 2.0 is likely to emerge in the foreseeable future. Conventional wisdom, especially from a realist perspective, would predict that, should China’s rise pose serious threats to US global interests, the latter would react by seeking to contain the former. In fact, the shift in US military focus from Europe to Asia, as announced by Panetta in Singapore in June this year, could be seen as an early sign of a containment policy. Similarly, at a sub-regional level, growing US involvement in the South China Sea dispute since 2010 shows that it is seeking to prevent China from realising its maritime ambitions. In short, the US is using the “China threat” in the South China Sea to rally force and support against China. America’s renewed interest in Vietnam, a country occupying an important geopolitical position and an historic rival of China, should therefore be framed within this context.

Should the Sino–US strategic competition continue to deepen, Vietnam, as a neighbour of China and a party to the South China Sea dispute, would have great difficulty in maintaining balance between the two powers and avoiding the fallouts. As the United States rebalances toward the Asia Pacific and deepens ties with countries in the region, China will not stand still. Accordingly, China will try to put pressure on Vietnam, to remind the country of the importance of a good relationship with China. For example, over the last few months there have been reports of China stopping or delaying the importation of certain goods from Vietnam for reasons that remain unclear. As previously mentioned, China recently established a military garrison in the newly-upgraded Sansha city to cover disputed areas of the South China Sea. The move is mostly aimed at Vietnam and the Philippines. On top of this, China seems to be quietly undertaking a diplomatic campaign to influence Cambodia, a long-time friend of Vietnam. Cambodia’s refusal, allegedly under China’s pressure, to issue a customary joint communiqué reflecting recent developments in the South China Sea at this year’s ASEAN Ministerial Meeting in Phnom Penh could be seen as a move by China to split Vietnam and Cambodia. As good relations with Cambodia are also essential to Vietnam’s security, it seems that China knows how to inflict pain on Hanoi if it fails to pay due attention to Beijing.

The possibility of Vietnam being drawn into a great-power game between the United States and China should not be exaggerated, however. It is still dependent on other developments. The most important one is how intense the strategic competition between the United States and China will be in the first place. Unlike the Cold War era, extensive and complex economic interdependence now tends to discourage the powers from a Cold War-style confrontation. Future developments in the foreign policy of the US, China, and Vietnam itself will also matter. For example, in the event that, thanks to concessions from China, a Code of Conduct on the South China Sea is adopted, Vietnam would feel less willing to deepen ties with the US if it came at the expense of its relations with China.

VIETNAM today, unlike the country of the Nguyen Dynasty nearly two centuries ago, does not want to squander another opportunity to strengthen its ties with Washington. However, as Sino-US strategic competition intensifies, the China factor again emerges as the most challenging problem for Vietnamese strategists and foreign policy-makers. They are torn between two choices: maintaining a good relationship with China and promoting stronger ties with the United States. As a small country and a neighbour of China, Vietnam does not want to choose between China and America. While the consequences of such a choice still remain to be seen, there’s no doubt it would be a painful one for Vietnam.

Dr Le Hong Hiep

Visiting Fellow, Institute of Southeast Asian Studies, Singapore

Le Hong Hiep was a contributor to American Review, a magazine published by the US Studies Centre. Le Hong Hiep is Visiting Fellow at the Institute of Southeast Asian Studies (ISEAS), Singapore, and a lecturer at the Faculty of International Relations, College of Social Sciences and Humanities, Vietnam National University, Ho Chi Minh City.